“PLI Scheme” for white goods and solar photovoltaic modules

What is the News?

The Union Cabinet approves two PLI schemes for white goods (air-conditioners and LED lights) and high-efficiency solar photovoltaic modules.

About Production Linked Incentive Scheme(PLI):

• The Government of India launched the Production-Linked Incentive(PLI)  in March 2020.
• Aim: The aim is to make manufacturing in India globally competitive by removing sectoral disabilities, creating economies of scale, and ensuring efficiencies.
• Under the scheme, incentives are offered to companies on incremental sales from products manufactured in India over the base year.

PLI Scheme For White Goods:

• PLI Scheme for White Goods shall provide an incentive of 4% to 6% on incremental sales of goods manufactured in India. The scheme is for a period of five years for the manufacturers of Air Conditioners and LED Lights.
• Eligibility:
  • Selection of companies under the scheme aims to incentivize the manufacturing of components or sub-assemblies in India. Mere assembly of finished goods shall not qualify for incentives.
  • Incentives shall be open to companies making both brownfield or green field Investments.
• Significance: The scheme is estimated to lead to an incremental investment of ₹7,920 crore over five years. It will lead to production worth ₹1.68 lakh crore as well as lead to 4 lakh jobs.

PLI Scheme for High-Efficiency Solar PV (Photovoltaic) Modules:

• Background: Firstly, solar capacity addition presently depends largely upon imported solar PV cells and modules. The domestic manufacturing industry has limited operational capacities of solar PV cells and modules.
  • Hence, the expectation from this scheme is to reduce import dependence in a strategic sector like electricity.
• Secondly, under the scheme, Solar PV manufacturers will be selected through a transparent competitive bidding process.
• Thirdly, the incentives will be disbursed for 5 years post commissioning of solar PV manufacturing plants on sales of high efficiency solar PV modules.
• Fourthly, A Manufacturer will get reward for higher efficiencies of solar PV modules and also for sourcing their material from the domestic market. Thus, the PLI amount will increase with increased module efficiency and increased local value addition.
• Significance: The scheme may lead to 10,000 MW of additional capacity of solar PV plants and investment of around ₹17,200 crores in solar PV manufacturing projects. It would also lead to direct employment of 30,000 people and indirect jobs to 1.2 lakh.

Source: The Hindu

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